City of Boiling Spring Lakes issued the following announcement on Oct. 17.
1. It seems as if we have all the money needed for the Dam Reconstruction, why do we need the referendum to pass?
Answer: When it was thought that the City would need to borrow $15 million, the Local Government Commission (LGC) required the City to hold the referendum because it would have increased the tax rate for the citizens. The LGC wanted to ensure the citizens had a say. The City will still need to borrow money for cash flow purposes because FEMA pays on a reimbursement basis. We have to initially pay the contractors for their work, submit for repayment from FEMA and wait sometimes up to six months for reimbursement.
There also is a chance that there will be cost escalations or problems during construction that may arise and have not been included in the current estimates. That being said, the amount needed will be a lot less than $20 million. It is anticipated that amount may be approximately $5 million. Please keep in mind, taxes would only increase IF we borrow funds and the amount of funds we actually borrow would determine the amount of any tax increase.
2. Why does the referendum still have the $20 million amount?
Answer: When the ballots were sent to be printed in August, we needed to ask for $20 million. The ballot is now set and cannot be changed.
3. Why should I approve the $20 million if the City will only need $5 million?
Answer: A yes vote for the referendum is showing support for the City to rebuild the dams. The LGC will not let the City borrow more money than we need, as shown by construction budgets and estimates. The City also doesn’t want to borrow any more than is needed. As stated above, it is anticipated the amount needed will be approximately $5 million.
4. What is the breakdown of the funds expected to be received?
Answer: The potential funding scheme, as listed in the recent McGill presentation'
5. What is the anticipated tax impact of borrowing $5 million?
Answer: The tax implication may be $.05 tax increase (an 18% increase). If the City is able to get additional funding, that will be a bonus; and the additional funding can be used to pay down the debt the City is incurring.
Not counting properties that are only land or commercial property, Boiling Spring Lakes has approximately 400 properties valued less than $100,000, about 1,500 properties between $100,000 and $199,999, approximately 625 properties between $200,000 and $299,999, and about 175 properties over $300,000.
Visit our FAQs regarding the Dams Restoration for great information - FAQs
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